US Tariffs Force Chinese Firms to Rethink Southeast Asia Shift

Chinese producers that rushed to relocate assembly lines to Vietnam, Thailand and other Southeast Asian nations are re-evaluating those plans after the United States imposed a 145% tariff on Chinese goods in April, the Financial Times reported. Executives told the paper that the narrow difference between duties on Chinese-made products and those shipped from alternative regional hubs has eroded the cost advantage of moving production out of China. The shift in calculus is rippling through regional supply chains. Thailand-based Siam Cement Group said it will restart its US$5.4 billion Long Son petrochemicals complex in Vietnam this month and is reviewing operations across the Association of Southeast Asian Nations, including deploying artificial-intelligence systems to trim costs. Other manufacturers are putting expansion plans on hold or negotiating new terms with local partners as they weigh whether the expense of relocating can still be justified under the revised tariff regime.